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CNN
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On Sunday, the price of a stamp goes up for the second time this year, jumping 5 cents for first-class postage to 73 cents. You probably didn’t notice.
And really, you might not care. But you should.
Most people don’t use mail the way they used to – if they send mail at all. But the cost of postage is a big deal for millions of businesses and organizations that spend about $40.8 billion a year on mail, including letters, bulk mail, junk mail and magazines. And higher prices make them less likely — and hurt the US Postal Service’s budget, and its ability to continue its essential services.
That includes everything from online shopping to life-saving drugs. And this year, tens of millions of voters will vote in the presidential election by mail. And, most of all, businesses still depend on letters to help them reach customers and keep the economy going.
Postage increases were based on inflation, usually rising once a year. But Sunday will mark the sixth increase in three years, during which first-class stamps rose 10 percent faster than general inflation.
Senior missionaries say skyrocketing prices will soon drive them out of the post office, eventually drying up the agency’s budget.
Check out this interview on CNN.com
“We think they’ve overstepped the mark in raising their rates,” said Michael Plunkett, CEO of the Postal Trade Association, which represents companies in the industry. of postage and delivery. “This rate increase doesn’t generate a lot of revenue because it takes a sound out of the system that probably won’t come back.”
The price of the first class stamp reached 10 cents in 1974, shortly before the 200th year of service. As recently as 2002 it stood at 34 cents, or half of today’s price before Sunday’s increase.
So if raising the price of stamps can jeopardize the postal service, why does the USPS keep raising the cost of mailing a letter? The short answer is because the agency needs money – badly. The long answer is more complicated.
The postal service and the United States have grown side by side since before the country was born – in fact.
Founder Father Benjamin Franklin was appointed as the first postmaster in 1775, USPS details on its website. The service expanded to accommodate the new community, and to help unify the small country. It was the main reason that roads were built between its first cities. US 1, the first federal highway, began as the Boston Post Road to carry mail between New York and Boston, and it still goes by that name in many places.
In October 2020, Smithsonian Magazine noted: “When Alexis de Tocqueville visited this small country in 1831, the United States boasted twice as many post offices as Britain’s and twice as many five more than France.” As of October 2020, it has 640,000 employees living in more than 30,000 buildings across the country.
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A woman buys stamps in Siren, Wisconsin, in 1941.
However, postage stamps took a little longer to appear. “Alexander M. Greig’s City Despatch Post, a private delivery company in New York City, issued the first adhesive stamps in the United States on February 1, 1842,” according to the Postal Service. Congress then authorized postage stamps in 1847, and postage became mandatory in 1855. The iconic Pony Express – a feature in many Western movies and stories – appeared five years later, in 1860. .
And the postal service has appeared elsewhere in pop culture and American history. The climax of the popular holiday movie “Miracle on 34th Street” has (spoiler alert) The postman saves Santa Claus on Christmas Eve. The characters of Cliff in the 1980s sitcom “Cheers” and Newman in the 1990s sitcom “Seinfeld,” were letter carriers. The band The Postal Service was an indie-pop darling towards the turn of the century. And the 1985 book (by David Brin) and the 1997 film (with Kevin Costner) “The Postman” take the importance of delivering mail in a dystopian, sci-fi future.
But the delivery of letters was stopped when new methods of communication and coordination were introduced.
Families and friends can communicate via email, text or apps. Bills can be paid electronically. The physical letter does not play the same role it once did in American life. For many, the individual letter is as important today as VHS movies, floppy computer discs and cassette tapes. This century’s name for traditional mail – snail mail – is not a compliment.
In its most recent year, the service delivered 11.4 billion individual letters. That may sound like a lot, but it’s down 75% from 20 years ago. Although stamp prices have doubled in that time, many experts point to technology instead.
“For most families, letters aren’t a lot of money,” Plunkett said. “If the price of a stamp was a dollar I would send the same number of Christmas cards later this year as last year.”
Universal History Archive/Universal Images Group/Getty Images
Mail dock workers load mail onto a truck in 1938.
On the other hand, online shopping has greatly increased the cost of goods. But the Postal Service doesn’t have a lock on the business it does in its mail service, said Kevin Kosar, a senior fellow at the U.S. Business Center.
“Before the digital age came, the Postal Service had a very important government. Those days are over,” he said. “The package business is going up, but that’s not their only business. It’s very competitive.
But Plunkett and other analysts worry that the growth of the competitive package business will not generate the profits needed to reduce the number of letters.
Major mailers would not like the idea of paying a lot of money for postage. But they argue, with a lot of evidence to support them, that raising prices as fast as they are climbing, drives the business out of service needs and worsens its economic situation.
“By raising the fees, the efficiency and productivity of the postal service is greatly reduced,” said Art Sackler, executive director of the Coalition for 21st Century Postal Service, a trade group that represents businesses that use the service. “Last year, by its measure, its success fell the most in 60 years.”
Analysts worry about rate hikes: Worsening finances and efficiency could eventually force the Postal Service into bankruptcy, possibly within a few years, and it could begin relying on subsidies direct taxes from Congress that it currently does not receive or cut. return to work and service.
The Postal Service under Postmaster General Louis DeJoy has created a 10-year plan through 2021 to improve service and eliminate ongoing losses. First, he told the Senate in April, the USPS has been in “financial death mode” for years, but that under the $40 billion modernization plan, “we are making the necessary changes to ensure that we are close to serving country well. the future.”
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Postal workers sort, file and deliver mail in Los Angeles in 2020.
But the plan, which includes rebuilding a network of mail-handling facilities, employing full-time staff, improving transport and delivery systems and investing in technology, has yet to be achieved. first promises.
The service was projected to break even in its last fiscal year and posted an annual profit of $1.7 billion in the current fiscal year. Instead, it lost $6 billion last year and is expected to lose $6 billion or more this fiscal year, according to congressional testimony by April from Michael Kubayanda, chairman of the Postal Regulatory Commission which sets standards.
And some organizations that represent postal workers are worried about the plan to improve finances by reducing the reliability of the service.
Mark Dimondstein, president of the American Postal Workers Union said: “The cost of a letter is still too high. “I think there is good and I think there is bad in the plan. I think we have to adapt to the world of the growing parcel business and the declining number of letters. Our concern with the 10-year plan is anything that reduces service. ”
Kubayanda testified in April that he doubts the current plan will be able to meet its financial and service goals.
“It seems increasingly difficult to have a universal postal system that reaches every American six days a week, at low cost, with fast and efficient service,” he said. trusted, and financially self-supporting.”
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